Although home prices continue to fall and sales of new and existing homes are up only slightly this year, manufacturers are ratcheting up prices of building products and materials, according to industry analyst Ivy Zellman.
“Wallboard, concrete, and lumber are all going up,” Zellman told several hundred people attending an Urban Land Institute conference in Washington, D.C., Tuesday. Zellman has been a home building and building products equity research analyst since 1992. “Building product manufacturers are pushing hard and homeowners are going to feel the squeeze.”
Zellman said that four large manufacturers that she surveyed recently but declined to name are making 20% profit margins, although sales of existing and new homes are at their lowest levels in decades. She said that even though manufacturers have “lots of capacity,” she expected prices to continue to rise as the housing industry recovers from the recession. – Jean Dimeo
Tags: industry
